Insurance Web Aggregator Licence

A web aggregator is an insurance intermediary or an insurance company that provides information on insurance provided by different companies. A web aggregator also provides a comparison of insurance products and also the prices of different insurance products. The web aggregator has been a company registered with the Companies Act 2013 or the previous company law 1956 and the IRDAI. A web aggregator provides information on different products to various insurers.

The web aggregator concept is developed when end consumers get quotes on the prices of different financial products. The aggregator either maintains a website or owns a website to provide information on the insurance products. For regulating these companies, an Insurance Web Aggregator Licence is required.

Role of a Web Aggregator

A web aggregator plays the following roles:

Compares insurance products.
Agreements are made between web aggregators and insurers. All relevant information related to insurance products has to be provided
Information related to insurance products is displayed on the website.
Having an Insurance Web Aggregator Licence would not permit a web aggregator to provide ranking and comparison of different insurance providers and their products.
Web aggregators can display only insurance products.
Solicitation of policies is allowed by web aggregators.
Solicitation is done through an online portal where information would be directly provided to the customer.

Why Insurance Web Aggregator Licence is required

Insurance Web Aggregator Licence is required so that insurance products can be shown to end customers.
To maintain the website related to Insurance Products.
To ensure that quality standards related to insurance products are maintained.

Who Regulates Insurance Web Aggregator Licence

The primary regulatory authority for the Insurance Web Aggregator Licence is the Insurance Regulatory and Development Authority of India (IRDAI). The Insurance Act 1938 and the Insurance Regulatory and Development Act 1999 are the regulations behind Insurance law. Apart from this, the Insurance Regulatory and Development Authority of India (Insurance Web Aggregators) Regulations, 2017, provide rules related to Web Aggregators.

Eligibility criteria for Insurance Web Aggregator Licence

For granting or renewing the certificate of registration for an Insurance Web Aggregator Licence the following have to be satisfied.

The applicant must be the following:

1) A Company formed under the Companies Act 2013; or

2) Limited Liability Partnership formed under the LLP Act 2008. The partners should not be a Non-Resident Indian or a person who is resident outside India under the Foreign Exchange Management Act 1999; or

3) Any other individual who is recognized as a web aggregator.

The MOA and AOA should be the main objects of the web aggregator business.
The applicant must not be engaged in any other business other than the web aggregation business.
The applicant must ensure that he is not registered as an insurance agent, corporate agent, micro-insurance agent, TPA, Surveyor and Loss Assessor, Insurance Marketing Firm, or any other insurance intermediary.
The applicant must have a referral agreement with the insurer.
The applicant or any of the entities of the applicant would be only granted one certificate for insurance intermediation. If any of the entities are engaged in the activities of insurance intermediation, then the application for a web aggregator’s licence would be determined based on the merits of the application.
The applicant has its website for insurance web aggregation.
The principal officer possesses the necessary qualifications for conducting web aggregation FORM C- Schedule I.
The principal officer has undergone the necessary training and passed the examination required by the specified authority.
The key management executives( Director/ Shareholders/ Other Principal Officers) have undergone the FIT and PROPER Criteria test in FORM D- Schedule-I
Authorized Verifier has gone through the prescribed training and passed the examination conducted by the specified authority.
The insurance web aggregator has not violated any obligations which are specified in Form V and Form W.
The authority has not withdrawn the certificate of registration of the Insurance Web Aggregator Licence.

Capital Requirements for Web Aggregators Licence

The applicant has to have a minimum paid-up capital of 25 Lakhs.
Where the Insurance Web Aggregator is a company according to the Companies Act 2013, the capital must be from the equity shares which are issued and subscribed.
In the case of an LLP, the partners' capital must only be in the form of cash.
The shares of the web aggregator held as capital must not be pledged in any manner to secure credit.

Net Worth Requirements for Web Aggregators Licence

Net worth must not fall below 100% of the capital requirements.
The insurance web aggregator must review the status of the net worth every half year as at 30 September and 31 March every year and report non-compliance, if any. This must be done to the authority within 15 days and restore such requirements within 30 days after that and confirm compliant to the authority.
If the Insurance Aggregator cannot maintain the net worth after 30 days, then the business related to the aggregator should be stopped.
Net worth Certificate has to be submitted every year, which is certified by a Chartered Accountant.

Process / Procedure for Insurance Web Aggregator Licence

Application for Registration

An Applicant who wants to register as a web aggregator must make an application in Form- A (the application for grant of certificate of registration).
Along with the application a fee of Rs. 10,000/- plus tax has to be paid through electronic transfer or demand draft payable in favor of the Insurance Regulatory and Development Authority of India payable at Hyderabad.
The application would not be processed without the payment of the fee.
If the aggregator is also going to provide outsourcing and telemarketing services, the same has to be mentioned in the same application form.
The applicant has to fulfill certain requirements. The following are the requirements which need to be fulfilled:

1) Whether the applicant has fulfilled the eligibility criteria;

2) Whether any key managerial persons are suffering from any disqualifications under the Insurance Act 1938;

3) Whether any individual who is connected directly or indirectly with the applicant has been refused in the past the grant of the license; and

4) Whether the applicant fulfills the capital and net worth requirements.

The authority would deal with the application for registration as a web aggregator’s licence.
The authority can ask to furnish extra documentation for the web aggregator’s licence.

Procedure for Insurance Web Aggregator Licence

If the authority feels that registration would be in the interest of the policyholders, then the authority would grant the certificate of registration in Form- E. This would be granted for the applicant to function as an insurance web aggregator.
The certificate of registration would be issued when the applicant satisfies the code of conduct laid down by the authority.
A new application for the certificate of registration can be made only after one year. This would be applicable in case of the lapse of the certificate, or the authority has refused to grant the certificate.
Certain conditions have to be followed by the applicant for the grant of certificate of registration.

1) The applicant can only solicit insurance.

2) The Web Aggregator shall comply with the provisions of the IRDA Act 1999.

3) The applicant should inform the authority of any material change or false/ misleading information, for previously provided documents.

4) Web Aggregators should take adequate steps for redressal of grievances within 14 days.

5) The Web aggregator shall maintain the code of conduct.

6) The Web aggregator shall solicit and procure a reasonable number of insurance policies commensurate with the resources.

7) The authority has the power to appoint another investigative agency to check the books and accounts of the web aggregator.

Rejection of Application- Insurance Web Aggregator Licence

An application for an Insurance Web Aggregator Licence can be rejected if the authority feels that the applicant has not fulfilled the requirements.
The authority must communicate the refusal to grant the application for an Insurance web aggregator license within 30 days of communication of the rejection.
An applicant can make a new application after one year of rejection of the application.

Documents Required for Insurance Web Aggregator Licence

Certificate of Registration of the Company or LLP as issued by the ROC;
MOA and AOA of the Company or the LLP Agreement;
Copy of PAN Card of the Company;
Profile of the Directors/Partners of the Company or LLP;
Profile of the Principal Officers along with the educational qualification certificates;
Brief preview of the contents of the website proposed for License;
Details about the hosting place of the website;
Details about the responsible persons for the website’ content;
Net worth certificate and shareholding pattern of the company as certified by the Chartered Accountant;
Audited financials for the last three years in case of an existing company or latest as on date in case of a new company;
Details of the IT infrastructure available with the applicant;
Organizational Chart with various designations with their roles and responsibilities; and
A user I.D. and temporary password (with only view permission) to verify the Aggregation Website(s)/Portal/LMS by IRDAI I.T. (Information Technology) Department in a closed cover.

The Principal Officer shall attest to the above documents.

Validity for Insurance Web Aggregator Licence

The Certificate of Registration (Insurance Web Aggregator Licence) is valid for three years from the date of the issue.

Insurance Web Aggregator Licence Renewal in India

The following procedure is required to renew an Insurance Web Aggregator Licence.

The application for renewal for the Insurance Web Aggregator Licence should be submitted in Form- F of Schedule II before 30 days of the licence expiry. The applicant can apply for renewal of licence 90 days before the expiry of the licence.
Documents should be submitted in Form- G with the application for registration.
The application for renewal of the registration will be submitted along with the fee of Rs. 25,000 with taxes. The payment has to be made through electronic mode or a demand draft in favor of the Insurance Regulatory and Development Body of India, Hyderabad.
If an application is made after the expiry of the above period, but before the actual expiry of the certificate, then a payment of Rs. 100/- must be made with the application.
If there is a delay in making an application for renewal of registration, the applicant must make the same. If this is within 60 days of the expiry of the certificate of registration, the applicant would have to pay Rs. 750/-.
Any application which is received after the expiry of the 60 days would be considered only after one year. In one year, the web aggregator must not conduct any business or solicit any form of business.
No Insurance Web Aggregator would be allowed to carry out a web aggregator's business without a valid certificate of registration.
An Insurance Web Aggregator, before seeking a renewal of a certificate of registration, shall ensure that the Principal Officer and the Authorized Verifiers have undergone renewal training, not before six months of the expiry of three years validity of his previous fresh/ renewal training from an institution recognized by the authority.
If the authority considers that the requirements have been met will provide the certificate of renewal in Form- H.

How can Enterslice help with Insurance Web Aggregator Licence

We file the application form on your behalf to get the Insurance Web Aggregator Licence for your business.
We monitor and track the status of the application on behalf of the client.
We value your time and money.
We also offer post compliance services for your insurance web aggregator business.

Frequently Asked Questions

How to obtain a No Objection Certificate (NOC)?

NOC is provided to an insurance web aggregator. The certificate can be used by the Web Aggregator to register the company under the Registrar of Companies. (ROC). The following documents have submitted to the authority for obtaining the NOC:

• The proposed name

• Address Proof, PAN Card, and the name of the proposed directors.

What will happen to the application for a Certificate of Registration if the application is incomplete?

An application, submitted by the Applicant that is not complete in all respects and/or not conforming to the instructions specified in application form and/or not complying with the requirements and/or directions of the authority, may be rejected.

Who is the Principal Officer (PO)?

The Principal Officer is an individual considered as a key management executive of the Insurance Web Aggregator. The principal officer conducts all the responsibilities and activities of the Insurance Web Aggregator business. The principal officer should have the requisite qualifications as required. The principal officer of the applicant must complete training from an institute as per the authority.

How is an insurance aggregator different from an Insurance broker?

The web aggregator's activities include providing prospects with several insurance policies to choose from according to their requirements. On the other hand, the insurance broker's duty includes suggesting the best insurance product depending upon the financial and other aspects of the prospects.

Is it necessary to have a website prepared for an Insurance Aggregator?

Yes, the applicant shall get a working website ready while preparing the website. It is also mandatory to submit the audit report of the website known as CISA Report certified by authorized professionals for this purpose.

What is the educational qualification required by the Principal Officer?

The principal officer must have the following qualifications:

• Graduate/Post Graduate in Arts, Science, or Social Sciences or Commerce or Engineering or Law or Management or its equivalent from any institution/university recognized the State or Central Government;

• Associate/Fellow member of the Insurance Institute of India, Mumbai; or

• Any post-graduate from the Institute of Insurance and Risk Management, Hyderabad; or

• Associate/Fellow member of the Institute of Chartered Accountants of India, New Delhi; or

• Associate/ Fellow member of the Institute of Cost and Works Accountants of India, Kolkata; or

• Associate/ Fellow of the Institute of Company Secretaries of India, New Delhi; or

• Associate/ Fellow of the Institute of Actuaries of India; or

• Certified Associates from the Indian Institute of Bankers, Mumbai; or

• Any other qualification specified from time to time by the authority under these Regulations.